[SMM Nickel Midday Review] Nickel prices rose slightly on November 28, with profits of industrial enterprises above the designated size nationwide increasing by 1.9% from January to October.

SMM Nickel November 28 News:

Macro and Market News:

(1) Russian President Vladimir Putin stated that a US delegation will visit Moscow next week. Putin said that Russian and Ukrainian special services have maintained contact. The two sides mainly exchanged views on humanitarian issues such as prisoner exchanges in Abu Dhabi. Recently, US representatives indeed held talks with Russian representatives in Abu Dhabi. Furthermore, Putin reiterated that Russia generally agrees to use the US-proposed list for resolving the Ukraine issue as a basis for future negotiations.

(2) National Bureau of Statistics (NBS): From January to October, the total profits of industrial enterprises above the designated size nationwide reached 5,950.29 billion yuan, up 1.9% YoY. In October, profits of industrial enterprises above the designated size decreased by 5.5% YoY.

Spot Market:

On November 28, the SMM #1 refined nickel price was 117,000-122,000 yuan/mt, with an average price of 119,500 yuan/mt, up 500 yuan/mt from the previous trading day. The mainstream spot premium quotation range for Jinchuan #1 refined nickel was 4,700-4,800 yuan/mt, with an average premium of 4,750 yuan/mt, up 100 yuan/mt from the previous trading day. The spot premiums/discounts quotation range for mainstream domestic brands of electrodeposited nickel was -100-300 yuan/mt.

Futures Market:

The most-traded SHFE nickel contract (2601) opened higher in the night session and edged up slightly, closing up 0.26%. On the 28th, prices continued to fluctuate rangebound in the morning session; as of the midday close, it was quoted at 117,160 yuan/mt, up 0.21%.

US Fed Governor Christopher Waller and San Francisco Fed President Mary Daly both sent dovish signals, expressing concerns about the labour market and supporting an interest rate cut in December. This significantly raised market expectations for a US Fed December rate cut probability to 70%-75%. Direct communication between the leaders of China and the US and the release of goodwill signals helped boost market confidence. Nickel prices are expected to fluctuate in the short term, with long-term pressure remaining. The price range for the most-traded SHFE nickel contract is expected to be 114,000-118,000 yuan/mt.